- UD Ministry proposes to increase user charges such that it cover operation and maintenance charges of smart cities.
- Basing on resource requirement for Smart Cities Mission and Atal Mission for Rejuvenation and Urban Transformation (AMRUT), the Ministry suggested the idea at a recent regional workshop on Smart Cities.
- During the workshop the UD Ministry has pointed out that user charges were way below cost recovery in urban areas citing low parking rates as example.
- It also pointed out the huge gap between the cost of providing urban services and cost recovery
- The Ministry is developing a Model Concession Agreement which includes risk allocation between public and private sectors, performance standards and coverage targets besides providing for flexibility to urban local bodies.
- The UD Ministry has informed the states that the government is pursuing a loan of USD 1 billion from Asian Development Bank and another USD 500 million from the World Bank to provide funds to the Special Purpose Vehicles to be created for each smart city